Oil prices declined on Thursday as traders weighed the risks of supply disruptions in the Middle East against the latest market outlook from the International Energy Agency (IEA). The tensions stemmed from attacks on ships in the Strait of Hormuz, a critical waterway for global oil transport. Brent crude futures for December delivery fell 1.5% to $104.52 per barrel, while U.S. West Texas Intermediate futures for November remained steady at $94.15 per barrel.
The Singapore maritime authority condemned the sinking of a Singapore-registered ship in the Strait of Hormuz, calling the attack a breach of international law. Meanwhile, Iran stated it was prepared to strike U.S. warships. The IEA warned in its October report that diesel market constraints could persist into next year, with recent attacks on Saudi Arabia threatening to disrupt oil supply recovery. The Trump administration is reportedly considering easing sanctions on 'shadow fleet' vessels to help stabilize prices.
Firas Bechwaty, head of business development at ICM, noted that the lack of progress in U.S.-Iran diplomacy leaves little chance for a full reopening of the Strait of Hormuz. He added that Saudi crude is still reaching buyers through alternative routes, and emergency stock releases by IEA members are helping prevent sharp price increases despite the elevated tensions.